Paramount Global, the company that has been in the media industry for many years and is known for broadcasting such famous programs as MTV, CBS, Nickelodeon, and others, is a topic of hot discussions nowadays, but not because of the start of a new successful television show.The company is experiencing a massive round of layoffs, particularly in the advertising department. These layoffs have happened as Paramount gets ready for the integration of Skydance Media and the changes have been aligned to cut operational costs.
Cost-Cutting Moves: Perceiving the New Normal
This week, Paramount’s employees in the advertising division were notified that some of them will be laid off although the number is still unknown. This is not the first time that Paramount has been undergoing a transition where earlier rumors pointed to around 2000 employees possibly being let go, or around 15% of the company’s U. S. workforce.
Why Paramount is making such changes?
Overall, CBS has faced significant financial issues, particularly after unveiling its streaming service, Paramount+. Facing the threat of the opportunity cost, Paramount has decided to cut down its expenses, which has the ultimate goal of achieving a half a billion dollars worth of savings.
The work of the advertising division
Why the advertising division?
It is a significant part of this company as it manages advertisement sales on multiple networks such as MTV, Comedy Central, and Pluto TV. ADs play a major role in generating revenues for media companies and I’m certain that Paramount depends on these revenues to survive. However, even the ad division was not spared, as the company continues to cut costs in preparation for merging with Skydance Media.
Besides, there is another large-scale action related to that merger: Paramount will merge with Skydance Media. Both companies expect that their merger would enhance the companies’ power in the entertainment market.
The Future of Paramount and its Employees
It is still unknown how many employees lost their jobs in the advertising division, but there is no doubt that Paramount has not been sparing its employees. The restructuring plans that have been implemented, have already seen the company close its television studio, more reductions in workforce might be expected. The financial and economic crisis is similar to watching a movie and getting to the point where you can’t believe that things are so tense and uncertain of how it will turn out.
Still, Paramount has decided to continue its expansion even in these challenging periods. After the merger with Skydance new opportunities are about to be opened but together with it some difficulties are expected. Change remains a prevalent phenomenon in mergers, and employees are usually left to speculate on the impact of the merged firm on their livelihoods.
Final Thoughts
The essence of the world of media and entertainment shows that change is the only permanent thing. The recent announcement of layoffs particularly in the advertising section of Paramount Global is a trend witnessed in the company as a way of trimming down its costs and therefore cracking the market efficiently and effectively in preparation for its merger with Skydance Media. However, this is not good for employees more so that they are left with no definite future as the company struggles to look for its financial breakthrough.
Only time will tell whether these changes will prove to be asset enhancing for Paramount and beneficial for its future strategic direction. As for now, we can surely say that the company is still in process of its change – and all changes always have their unique stash of obstacles on the way.
